CPUC NEM 3.0 discussion

[getakey]

I continue to get hung up on "you pay the rates as it is now", because what you describe is not how it works under NEM 2.0 with a CCA.

Today I pay PG&E or a CCA Generation plus Transmission/Distro including PCIA. Generation rate is different for CCA. I'm saying continue that as is for all electricity used.
The change I am proposing is for exported electricity. Today I get credit at the full Retail rate. I'm saying credit me at the Generation rate (whether it is CCA or PG&E), but charge me for the Transmission/Distro (except for PCIA) on the exported energy since I am "using" the grid for both import and export.

 

[Redhill_qik]

Today I pay PG&E or a CCA Generation plus Transmission/Distro including PCIA. Generation rate is different for CCA. I'm saying continue that as is for all electricity used.
The change I am proposing is for exported electricity. Today I get credit at the full Retail rate. I'm saying credit me at the Generation rate (whether it is CCA or PG&E), but charge me for the Transmission/Distro (except for PCIA) on the exported energy since I am "using" the grid for both import and export.

Late me reword this for you.

The change I am proposing is for exported electricity. Today I get credit at the full Retail rate. I'm saying credit me at the Generation+PCIA rate (whether it is CCA or PG&E), but don't credit me for the Transmission/Distro on the exported energy since I am not "using" the grid for export.

This is similar to how I proposed NEM 3.0 should work, by paying 100% for all imports with only the generation offsetting for exports.

 

[getakey]

don't credit me for the Transmission/Distro on the exported energy since I am not "using" the grid for export.

 

[Redhill_qik]

don't credit me for the Transmission/Distro on the exported energy since I am not "using" the grid for export.

eh, either way works for me.

 

[wwu123]

Today I pay PG&E or a CCA Generation plus Transmission/Distro including PCIA. Generation rate is different for CCA. I'm saying continue that as is for all electricity used.
The change I am proposing is for exported electricity. Today I get credit at the full Retail rate. I'm saying credit me at the Generation rate (whether it is CCA or PG&E), but charge me for the Transmission/Distro (except for PCIA) on the exported energy since I am "using" the grid for both import and export.

Hmmm, Transmission/Distribution > Generation on many plans by a few cents. So not exporting at all would be better than this approach, which would literally charge you for any exports?

 

[getakey]

Hmmm, Transmission/Distribution > Generation on many plans by a few cents. So not exporting at all would be better than this approach, which would literally charge you for any exports?

yeah - Redhill corrected it for me. Don't charge me for those fees with export, rather don't credit me

 

[holeydonut]

This is similar to how I proposed NEM 3.0 should work, by paying 100% for all imports with only the generation offsetting for exports.

Too bad the CPUC and the IOUs don't like your proposal lol.

In the beginning of the NEM proceeding, the bulk of the effort was to address the question "what is a fair rate for exports under NEM 3.0?" Developing that ACC calculator and numeorus studies on the whole "true value of solar" have been going on for like 3+ years.

I think most solar advocates thought that having the ACC rate instead of the retail rate on exports was going to make NEM 3.0 challenging. Imports would still be at the retail rate, and the NBCs were still somewhat reasonable. And, there was a reasonable glide path/market transition credit (MTC) that I think the residential solar industry could still make the economics work.

Unfortunately, then the cost shift baloney came into scope, and a bunch of the "gotta help the poors" hopped on that bandwagon. So alongside the ACC rate on exports, there was huge traction to get NEM 3.0 customers to pay a wildly higher fixed cost fee than NEM 1.0 and NEM 2.0. The SEIA and CALSSA have been getting absolutely nuked on this front. Every time they argue that residential solar + ESS is a means to reduce demand using clean energy, the CPUC tells them to get effed because of the fixed costs equity topic. The CPUC thinks a solar customer should be paying the same total fixed costs than a home without solar.

No pro-solar argument so far on the fixed costs has made inroads with the CPUC's agenda to ultimately just gut/kill residential solar. If you have any ideas on how to message the CPUC, please get in touch with them ASAP lol.

 

[holeydonut]

If ya'll want to get your blood pressure up, read the comments from the Coalition of California Utility Employees...

http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M490/K475/490475644.PDF

"Customers with behind the meter generation depend on the grid nearly every second of every day and should pay their fair share of transmission and distribution costs along with nonbypassable, unavoidable and shared costs to ensure equity among customers. These costs would be paid by tariff customers were it not for behind the meter generation, and these costs do not go down because of customer self-generation."
...
" Therefore, expanding the list of NBCs is no substitute for a GPC (Grid Participation Charge... aka the $8 per kW AC per month). Rather, an expanded list of NBCs (collected on Gross Consumption) should be layered on the top of the GPC."

I really hope someone here has a clever way to get through to the CPUC... because they're not getting much new perspective/arguments to help keep the residential solar industry going.

 

[RKCRLR]

If ya'll want to get your blood pressure up, read the comments from the Coalition of California Utility Employees...

http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M490/K475/490475644.PDF

"Customers with behind the meter generation depend on the grid nearly every second of every day and should pay their fair share of transmission and distribution costs along with nonbypassable, unavoidable and shared costs to ensure equity among customers. These costs would be paid by tariff customers were it not for behind the meter generation, and these costs do not go down because of customer self-generation."
...
" Therefore, expanding the list of NBCs is no substitute for a GPC (Grid Participation Charge... aka the $8 per kW AC per month). Rather, an expanded list of NBCs (collected on Gross Consumption) should be layered on the top of the GPC."

I really hope someone here has a clever way to get through to the CPUC... because they're not getting much new perspective/arguments to help keep the residential solar industry going.

I could provide plenty of graphs that show that there a lot of seconds of every day that I don't rely on the grid. Using that logic, the people with larger systems that rely on the grid fewer seconds of the day less should pay less. And people with storage should pay even less.

 

[getakey]

kind of lacking on the details

Upheaval in utility regulation emerging nationally as Hawaii validates a performance-based approach

Hawaii’s hard work on a PBR framework that protects utilities, consumers and the environment is paying off, but other states’ shortcuts could undermine success, advocates worry.

www.utilitydive.com

 

[iollmann]

I probably have a minority position, but I think if our current policies are producing too much daytime power and too little evening power we should not be encouraging even more daytime production. It makes sense to encourage reduced usage/generation during peak periods.

Personally, I feel that if the duck curve gets so bad that noon time wholesale energy prices go negative, NEM rates should also go negative. Solar only customers with no shutoff can pay to put more energy on the grid. New solar installs should include batteries, and existing ones ought to look into it.

This large charge for merely having solar panels doesn’t make any sense to me.

 

[jjrandorin]

Personally, I feel that if the duck curve gets so bad that noon time wholesale energy prices go negative, NEM rates should also go negative. Solar only customers with no shutoff can pay to put more energy on the grid. New solar installs should include batteries, and existing ones ought to look into it.

This large charge for merely having solar panels doesn’t make any sense to me.

Please discuss this topic in this thread i moved your post to. thanks

 

[stopcrazypp]

I could provide plenty of graphs that show that there a lot of seconds of every day that I don't rely on the grid. Using that logic, the people with larger systems that rely on the grid fewer seconds of the day less should pay less. And people with storage should pay even less.

They are arguing the opposite, the ones that rely less on the grid needs to pay more money to maintain the grid for the times that they use it. Basically as long as you are connected to the grid, the more usage you offset, the more you have to pay (that's where the per kW AC measure comes in). This is the whole cost shift argument (they are conveniently sweeping under the rug that the core issue is that there isn't a flat fee in general that applies to all users, instead they are singling out solar owners as the bad guys/scapegoats).

 

[RKCRLR]

They are arguing the opposite, the ones that rely less on the grid needs to pay more money to maintain the grid for the times that they use it. Basically as long as you are connected to the grid, the more usage you offset, the more you have to pay (that's where the per kW AC measure comes in). This is the whole cost shift argument (they are conveniently sweeping under the rug that the core issue is that there isn't a flat fee in general that applies to all users, instead they are singling out solar owners as the bad guys/scapegoats).

Where is the proposed surcharge for people that offset their usage through conservation and efficiency?

 

[BGbreeder]

I am not advocating the $8/kW charge, but it occurs to me that the IOUs are approaching this in an analogous way that they approach an industrial customer that offsets loads through internal generation. During the winter on cloudy days, many solar customers, especially those without ESS, will need to draw on the grid for power. IOUs will need to have that generation capacity available, and that has a year-round cost.

In the industrial case, if the customer ever draws on the grid for X MWH of power, they must pay a standby fee every month for X MWh, even if it is only used once a year for annual service for a week. As a result, many industrial customers bring in large generators for service periods to avoid paying the monthly fees. The IOUs that I have dealt with always rationalized the charge along the lines of "well, we have to reserve that amount of generation capacity for the once a year event, so you have to pay to have it ready." It made a number of cogeneration projections much more expensive due to the need to bring in standby power during service intervals, with all of the rental, running, and hookup costs.

It does definitely skew the ROI on home solar.

All the best,

BG

 

[miimura]

I am not advocating the $8/kW charge, but it occurs to me that the IOUs are approaching this in an analogous way that they approach an industrial customer that offsets loads through internal generation. During the winter on cloudy days, many solar customers, especially those without ESS, will need to draw on the grid for power. IOUs will need to have that generation capacity available, and that has a year-round cost.

In the industrial case, if the customer ever draws on the grid for X MWH of power, they must pay a standby fee every month for X MWh, even if it is only used once a year for annual service for a week. As a result, many industrial customers bring in large generators for service periods to avoid paying the monthly fees. The IOUs that I have dealt with always rationalized the charge along the lines of "well, we have to reserve that amount of generation capacity for the once a year event, so you have to pay to have it ready." It made a number of cogeneration projections much more expensive due to the need to bring in standby power during service intervals, with all of the rental, running, and hookup costs.

It does definitely skew the ROI on home solar.

All the best,

BG

The Winter demand in California is far lower than Summer. There is no lack of generation to supply customers that have low generation on Winter days. Hydro from the PNW can easily satisfy that if you want to insist on renewable substitution.

I've never looked into it, but are you sure Standby charges are based on MWh and not MW?

 

[holeydonut]

I am not advocating the $8/kW charge, but it occurs to me that the IOUs are approaching this in an analogous way that they approach an industrial customer that offsets loads through internal generation. During the winter on cloudy days, many solar customers, especially those without ESS, will need to draw on the grid for power. IOUs will need to have that generation capacity available, and that has a year-round cost.

In the industrial case, if the customer ever draws on the grid for X MWH of power, they must pay a standby fee every month for X MWh, even if it is only used once a year for annual service for a week. As a result, many industrial customers bring in large generators for service periods to avoid paying the monthly fees. The IOUs that I have dealt with always rationalized the charge along the lines of "well, we have to reserve that amount of generation capacity for the once a year event, so you have to pay to have it ready." It made a number of cogeneration projections much more expensive due to the need to bring in standby power during service intervals, with all of the rental, running, and hookup costs.

It does definitely skew the ROI on home solar.

All the best,

BG

Haha, the irony is the $8 per kWp AC per month charge is only being applied to residential solar installs. Commercial installs are exempt because they've lobbied the CPUC. Corporations like Walmart have been especially vocal making sure NEM 3.0 doesn't make their businesses pay a "fair share grid participation fee".

 

[holeydonut]

I found a new nugget in the CALSSA comments... haven't seen this angle before.

So the CPUC has accepted a residential up-front cost estimate (before the ITC) for solar and ESS as follows:

And the target payback the CPUC estimates for systems with this installation cost is around 10 to 17 years in NEM 3.0. Naturally they won't share the model to calculate this... they will only share the output.

Anyways... the CALSSA is arguing that this approach is irrational. They say that every solar and ESS installation exists on a spectrum of complexity; with some potentially costing more than the cost estimate above. Even if @nwdiver thinks firms can get some deals close to the target cost level, it is unlikely the blended average of all installs will hit those targets. Especially if everyone needs to install new bollards and integrated rise of rate heat sensors.

Quoted from the CALSSA comments:
"If systems that cost more than the median do not have a reasonable path to payback, it is highly likely that many of those projects would not be pursued. This drop-off in installations would come at a price to firms, and would increase the per customer costs for remaining projects."

Since the SEIA and CALSSA have repeatedly lost the battle challenging that cost table, it'll be interesting to see if the CPUC gives a damn with this new comment. Knowing the CPUC's track record so far, they'll take the position of "Whatever you loser residential solar installers. You'll just get better and more efficient... unlike the IOUs who can do ****-all and just charge people for it all willy nilly."

I still think the CPUC wants to kill residential solar, and will just shrug off comments that harm their own agenda. They'll "consider" the inputs, but they're clearly doing whatever it takes to stop NEM and future residential solar installs.

 

[getakey]

a 10 year payoff to me is borderline to proceed. Anything longer and I would not do it.

 

[holeydonut]

a 10 year payoff to me is borderline to proceed. Anything longer and I would not do it.

Yep, and that's why the Coalition of California Utility Workers (and the lobby arms of the CAISO members/IOUs) have long said California homeowners aren't the green eco-crew they purport to be.

Those groups have said California homeowners are just selfish/rich a-holes who want to save money at the expense of poor people. The moment the costs don't make sense for these rich California fat cat homeowners, they choose not to do solar. And, for the most, part I think the CPUC (via CalAdvocates) now agrees with this POV. Which is why they've pushed so hard to make NEM 3.0 a proposition only for the few that will mostly ignore ROI in their pursuit for green-ness.

Naturally they're more polite/eloquent in their wording. I'm just putting a Fox-News style hate-spin on it because being nice about the narrative hasn't really worked out for the SEIA, CALSSA, and residential solar advocates.

Edit: SEIA and residential PV industry showed the CPUC a study whereby around 95% of customers would NOT do residential solar with the economics shown in the NEM 3.0 PD. Basically the remaining 5% are the "less ROI focused" ones that prioritize going green. The CPUC didn't care.

It doesn't matter if you are eco-green, greedy (or both)... In 20 years when everyone's NEM 1.0 and NEM 2.0 grandfathering is over, everyone will need to return to the Grid. We're all one team; but the utilities have pit ratepayers against each other so the IOU agenda can play out.